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Buyers Just Said, Hey Guys, You’re Trying To Get Too Much Money Now

A report from the Columbia Business Report in South Carolina. “Residential real estate in South Carolina enjoyed a positive 2019, and realtors expect the growth to continue through the early part of 2020. ‘Overall, people are making more money (and) houses are selling faster, in a shorter amount of time. I will say buyers are taking a little bit more time to buy a house, but overall, it’s going well,’ said Brad Allen, broker-in-charge at Art of Real Estate in Columbia. What also helps the market are low interest rates and potential buyers getting financing, insiders say.”

“‘I’m seeing lenders e-mailing almost weekly or monthly saying ‘We can take lower credit scores now,’ Allen said. ‘There’s less down payment. There are programs that are coming out that require no down payment at all. So I think it’s as easy as it has ever been to get a mortgage.'”

The Roanoke Star in Virginia. “Despite recent headlines speculating on the probability of another housing bubble, Virginia’s robust demand and limited supply—fundamentals indicative of a healthy economy—are the driving forces behind the rising prices. ‘While home prices have reached the peak levels seen during the height of the housing boom, there is no evidence of a bubble because price appreciation now is much more modest,’ says Virginia REALTORS Chief Economist Lisa Sturtevant, PhD. ‘During the housing market boom of the middle of the last decade, the double-digit price growth was driven by other factors–particularly loose lending requirements–which are not present now.'”

From C & G Newspapers in Michigan. “Good news: 2020 is looking like another fabulous year for both commercial and residential real estate purchases. But it won’t be quite as fabulous as 2018 or 2019. Coldwell Banker Weir Manuel CEO John North assured forecast guests that the housing market in Oakland County is still thriving. ‘The numbers are good; 2018 versus 2019: up, up, up. Everything is looking good. A little variation as you start to spread out across the county. That’s very normal,’ he said.”

“Sometimes good news can be too good. North was asked if the thriving markets could be described as experiencing a bubble, similar to what led to the last recession. North was quick to quell that suggestion. ‘I’m not a big believer that we’re in a bubble of any sort as it relates to real estate, residential or commercial. I believe due to a lot of the changes that were made during the last downturn, and I think most experts believe, that if we have a recession, it would probably be short lived, and certainly there’s no indication that housing will play any role in leading us into it like it did in the past one,’ he said.”

The Star Tribune in Minnesota. “Being a 26-year-old Minneapolis native who has lived in San Francisco and now lives in Brooklyn, N.Y., I often look at home prices in the city I grew up in and imagine making the move back to own my slice of the American dream. I rationalize this fantasy by telling myself the Twin Cities are one of the last urban areas where real estate is still available to the middle class. Only, it’s becoming less possible by the day. One two-bedroom, two-bathroom Minneapolis house I saw on Zillow had skyrocketed in price in just over three short years — from $250,000 in 2016 to $345,000 in 2020.”

“I thought about writing this while walking the span of Central Park South known as Billionaire’s Row, an imposing stand of glass super-talls that are owned by the hundred millionaires and billionaires among us. Most of these units stand unattended by their owners, empty palaces in the sky. Where shortsighted thinking is taking precedent to reason and sanity in the name of fast dollars for the few. A place natives might soon be forced to move on from, and where firms with the most capital to develop vapid ‘luxury’ units become our slumlords.”

“What’s going on in the Twin Cities may not be the product of fraud. But it seems to be the product of greed and a lack of attention to Minnesota’s once-great middle-class standard of life.”

From Boston Magazine in Massachusetts. “When it comes to the area’s sky-high real estate prices, ‘We’re in extra innings right now,’ says Dana Bull, of the North Shore’s Sagan Harborside Sotheby’s International Realty. ‘It doesn’t make any sense how it continues to go at the rate it’s going.’ That said, buyers have started to pump the brakes, and Bull predicts that will continue into the foreseeable future.”

“Across Greater Boston last year, the median price of a single-family home increased only half as much as the previous year—a phenomenon Sagan agent Matthew Dolan attributes to house hunters tiring of bidding wars that drive prices over asking. ‘At some point over the last year, buyers just said, ‘Hey guys, you’re trying to get too much money now, and we don’t see [the value],’ he says. ‘We’re here, we’re ready to buy, but you guys are taking it too far.’ If nothing else, 2020 may be the year buyers can have at least 24 hours to put in their offer before their dream home gets snapped up.”

The West Side Rag in New York. “While Upper West Side home prices are still astronomical based on most metrics, they’ve been dropping in the past year, according to Streeteasy. Sales prices have fallen and homes are staying on the market longer. Sales Prices are at $1,098,267 (down 2.9% from last year) and the lowest level since 2015. 12.4% of homes on the market had a discount in January. Homes lingered on the market nearly two weeks longer for a total of 117 days – last year it was 104 days.”

“‘Upper West Side home shoppers are currently in the driver’s seat,’ said StreetEasy economist Nancy Wu. ‘More and more homes are coming onto the market, which means that sellers here are facing stiffer competition to stand out. This is good news for buyers, because they now hold the negotiating power, and can afford to be picky during their home search.'”

From Mansion Global on California. “The long-time Palm Springs, California, home to the late Jim Houston, an athlete, businessman and philanthropist, sold for $6.495 million after it was restaged and relisted with a price reduction. The 11,080-square-foot residence, including eight bedrooms and 14 bathrooms, has been on and off the market since April 2015, once asking as much as $11 million, listing records show.”

The Wall Street Journal. “The Securities and Exchange Commission’s top official overseeing credit-rating firms said Monday the agency is rethinking its post-crisis effort to improve the quality of bond ratings, a tacit acknowledgment that the decade-old program has been a failure. Jessica Kane, who heads the agency’s Office of Credit Ratings, told a conference in Las Vegas that the SEC is now seeking input on ways to limit the pressure firms such as S&P Global Inc. and Moody’s Corp. face to boost bond ratings. Bond issuers, which benefit from higher ratings, pay the ratings firms to grade the bonds.”

“‘Are there other ways to address the issuer-pay conflict of interest?’ Ms. Kane asked a ballroom of attendees at the Structured Finance Association’s annual conference. Ms. Kane’s speech firmly puts credit ratings on Washington’s financial regulatory agenda. The issue has already received attention from lawmakers as well as investors concerned about security ratings. After the 2008 financial crisis, credit-rating firms were criticized for taking lucrative fees and giving high grades to risky securities that later caused big losses for investors.”

“After the financial crisis, the SEC didn’t end the practice of bond issuers hiring the firms that rate their offerings. Instead, the SEC decided to encourage ratings firms to publish unsolicited ratings on securities they weren’t hired to analyze. The agency crafted a rule to give them access to deal data to publish such ratings.”

“In October, The Wall Street Journal reported that the program had failed to promote the issuance of unsolicited grades from ratings firms, which concentrated on grading deals they are hired to handle. The article followed an investigation that found that inflated credit ratings were making a comeback in structured-finance markets. Ms. Kane said that ‘in light of comment received suggesting that the program is not achieving the commission’s goals, the commission directed staff to further evaluate the effectiveness of the program overall.'”

From DS News. “Experts predict that increases in foreclosure and REO inflow will come from government-insured loans, according to the Auction.com 2020 Default Servicing Industry Insights. The majority of servicers Auction.com surveyed expect foreclosure and REO inflow to increase in five of seven U.S. regions. According to the report, 89% said they expect government-insured foreclosure and REO inflow to increase in 2020, the highest among four product types provided as options in the survey.”

“The majority of survey respondents said they expect foreclosure and REO inflow to increase in 2020 in five of seven U.S. regions provided as options in the survey. ‘Most in the default servicing industry expect government-insured loans to be the primary source of increased foreclosure inflow in 2020, even in the absence of a widespread recession or housing downturn,’ said Jesse Roth, SVP of Strategic Partnerships and Business Development with Auction.com. ‘That’s a rational conclusion given the rising risk profile of FHA-backed loans originated in the last five years.'”

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This Post Has 111 Comments

  1. ‘I’m seeing lenders e-mailing almost weekly or monthly saying ‘We can take lower credit scores now…There’s less down payment. There are programs that are coming out that require no down payment at all. So I think it’s as easy as it has ever been to get a mortgage’

    Eat yer crowz jingle male.

    ‘Experts predict that increases in foreclosure and REO inflow will come from government-insured loans…89% said they expect government-insured foreclosure and REO inflow to increase in 2020, the highest among four product types provided as options in the survey’

    ‘Most in the default servicing industry expect government-insured loans to be the primary source of increased foreclosure inflow in 2020, even in the absence of a widespread recession or housing downturn…That’s a rational conclusion given the rising risk profile of FHA-backed loans originated in the last five years’

    If you lower lending standards, you get more defaults like turning a valve.

    1. ‘Most in the default servicing industry expect government-insured loans to be the primary source of increased foreclosure inflow in 2020, even in the absence of a widespread recession or housing downturn…That’s a rational conclusion given the rising risk profile of FHA-backed loans originated in the last five years’

      Five years. It was in late 2014 Mel Watt opened the lending spigots.

    2. I do hope that Jinglemale gives up an update. Last we heard, he was liquidating his properties to retire in San Diego. IIRC he bought them outright in 2009-2010 so he’s unlikely to lose money.

    3. I have not met a single person in life who is not parroting the msm talking points about housing.

      “There’s no subprime this time.” “It’s different this time.” “It’s not a bubble.”

      I don’t get it. These are otherwise reasonably intelligent people.

      1. Do you want to eat the blue pill and climb back inside your matrix egg, and live-out your days in blissful ignorance and happiness?

        1. Or take the red pill and realize that the MSM is lying to you and the system has been rigged against you since before you were born. You would think making the biggest purchase of one’s life would motivate people to do their own research.

          https://archive.org/details/TheCreatureFromJekyllIslandByG.EdwardGriffin/page/n3/mode/2up

          “The quintessential treatise on economics. Cussed and discussed by all from notable politicians to academicians to laypersons. Do you want to know the truth about money? Creature from Jekyll Island will give you the answers to these, and other, questions: Where does money come from? Where does it go? Who makes it? The money magicians’ secrets are unveiled. We get a close look at their mirrors and smoke machines, their pulleys, cogs, and wheels that create the grand illusion called money. A dry and boring subject? Just wait! You’ll be hooked in five minutes. Creature from Jekyll Island Reads like a detective story which it really is. But it’s all true. This book is about the most blatant scam of all history. It’s all here: the cause of wars, boom-bust cycles, inflation, depression, prosperity. Creature from Jekyll Island is a “must read.” Your world view will definitely change. You’ll never trust a politician again or a banker.”

  2. ‘The long-time Palm Springs, California…sold for $6.495 million after it was restaged and relisted with a price reduction. The 11,080-square-foot residence, including eight bedrooms and 14 bathrooms, has been on and off the market since April 2015, once asking as much as $11 million’

    Eat yer crowz Thornberg…

  3. ‘One two-bedroom, two-bathroom Minneapolis house I saw on Zillow had skyrocketed in price in just over three short years — from $250,000 in 2016 to $345,000 in 2020’

    This should never happen. It did happen, right out in plain view, and the MSM and central bankers didn’t say boo.

    ‘I thought about writing this while walking the span of Central Park South known as Billionaire’s Row, an imposing stand of glass super-talls that are owned by the hundred millionaires and billionaires among us. Most of these units stand unattended by their owners, empty palaces in the sky. Where shortsighted thinking is taking precedent to reason and sanity in the name of fast dollars for the few’

    There’s empty canyons of super expensive airboxes all over the planet, but no bubble?

  4. “Where shortsighted thinking is taking precedent to reason and sanity in the name of fast dollars for the few”

    GREED.

  5. $o, actually, the $ell.off$ in $tocks began last Thursday. 😷 😵 ☎ 🚑 … 🚁💲💰💉🎢 … 😇🎉

    29,333.29 – 27,493.15 = … (-1840.14) (-6%) = a “$omewhat” decent $tart.

  6. Some absolutely violent swings in the DOW right now. It sold off 50 points in the blink of an eye. It is down 505 right now.

      1. Emancipate yourself from mental slavery
        None but our self can free our minds
        Have no fear for atomic energy
        Cause none of them can stop the time
        How long shall they kill our prophets
        While we stand aside and look?
        Some say it’s just a part of it
        We’ve got to fulfill di book

        2. As the song progresses, Marley turns his gaze outward to his adoring fans and gives them some words of advice. To do this, he borrows from a speech by noted orator Marcus Garvey, whose views on uniting all those of African descent were a strong influence on Rastafarian principles.
          “Emancipate yourselves from mental slavery/ None but ourselves can free our mind,” he paraphrases Garvey, suggesting that those he is addressing have the means within them to break free from any figurative bonds.

          Marley also suggests that technological advances pale in comparison to cosmic truths. “Have no fear for atomic energy/ ‘Cause none of them can stop the time.” Yet he’s dismayed at the deaths of the modern-day prophets (think JFK, MLK, etc.) at the hands of man, calling on his brethren to rise up to Biblical standards: “We’ve got to fulfill the book.”

          These empathetic strains and social concerns, along with its campfire sing-along quality, makes “Redemption Song” attractive fodder for cover artists, especially for those facing big crowds wanting to unleash positive vibes on the throngs.

          That’s probably why Bob Geldof and Steven Van Zandt teamed up for an impassioned version at the Amnesty International Conspiracy of Hope show in New York in 1986, or why Jackson Browne chose to perform it at the Concert for the Rock And Roll Hall of Fame in Cleveland in 1995.

          Bob Marley essentially had that opportunity with “Redemption Song,” the last song on his final album with The Wailers, Uprising, in 1980. He died on May 11, 1981 at age 36 from complications from cancer. While there’s no indication that Marley knew for sure that the song would be his last recorded document, the contemplative mood of Uprising and the fact that he had been battling the cancer for years seems to suggest that he knew the end was near.

          This article appears in our January/February Legends Issue.

          Features |Articles |Behind The Song:

          Behind The Song: Bob Marley, “Redemption Song”
          By Jim Beviglia – September 26, 2019

      3. LOL@ Fidelity and Schwab customers couldn’t log into their accounts yesterday because of the coronacrash.

        1. 29,333.29 – 27,111.29 = … (-2,222.00) (-7.15%) = a “$omewhat” + “better” decent $tart.!

          Here come$ the parade of dtRumpsis Cheer.leader$!

          Kudlow says U.$. can avoid rece$$ion if there is a global downturn
          By Robert Schroeder |Published: Feb 25, 2020 1:59 p.m. ET

          Top White House economi$t Larry Kudlow said Tuesday he’s confident the U.S. would be able to avoid a rece$$ion even if other countrie$ experience one.

          Speaking on CNBC, Kudlow said China would take “an awfully big hit” economically from the coronavirus but that recent data shows the U.S. is holding up well.

          Earlier Tuesday an official from the Centers for Disease Control and Prevention said Americans should prepare for the COVID-19 coronavirus to spread in their communities and cause disruption.

          ( “China, we don’t need you!” … “China, we need you!” )

          1. I’m comforted knowing I haven’t lost a dollar because I don’t participate in the reckless gambling of Wall St.

          3. I can only watch them drop in value.

            That’s just your tax liability being reduced! 😀 (I have the same)

          4. It’s best not to count your chickens before they hatch (although I understand the desire to).

  7. ‘Democratic presidential candidate Joe Biden unveiled a $640 billion housing plan on Monday that the former vice president’s campaign said will improve affordability and establish a Homeowner and Renter Bill of Rights’

    ‘The proposed bill of rights, modeled on similar legislation that passed in California, would bar mortgage servicers from foreclosing while homeowners are modifying loans and establish a right to timely notifications of loan modification status for borrowers’

    https://thehill.com/homenews/campaign/484309-biden-proposes-640b-housing-plan

      1. I expect Sanders to push something even more radical if elected. Maybe forgive all government backed mortgages. Not that it will happen.

    2. Creepy Joe is disintegrating. Claiming his son was US attorney general and that he negotiated the climate accord in China with Deng Xiao Ping.

      Open house popped up in my San Diego neighborhood over the weekend. Went to check it out. Yet another flip. One of these ~950 sq ft tiny 2/2 single car garage places. No landscaping aside from covering everything with mulch. Cheap laminate flooring, new kitchen appliances and granite counter tops. Didn’t even look like they painted the place. Just like in the last bubble, at the peak the flips get sloppier and sloppier and “investors” go lower and lower with the quality of properties they try to eke out a profit from. Though I am utterly flummoxed to see this much investor activity in a market this inflated.

      1. Open house popped up in my San Diego neighborhood over the weekend.

        I went to two open houses on Sunday even though I wasn’t interested in either. I wanted to see why they might be lingering on the market longer than some of their comparables. A HUGE puddle in front of the garage from Saturday’s rain wasn’t a good first impression for one of them.

      2. Now he’s just after asking people at his last speech to support him in his campaign for the “senate” and if people don’t like him to vote for “the other Biden”. The poor guy has gone daft.

    3. C’mon man!

      I got a plan.

      We’re gonna stop these foreclosures while homeowners are modifying these loans. Because in Wilmington, Delaware when I was the only white lifeguard at a public pool, this leader of a local gang named Corn Pop said that he will be waiting outside with a switchblade when my shift is over.

      So I wrapped a metal chain around my arm and said me and Barack will assist tenants facing eviction.

      Joe Biden Recalls Terrifying 1960s Public Pool Confrontation With Razor-Wielding Gangster Named “Corn Pop”

      Posted By Tim Hains
      On Date September 15, 2019

      https://www.realclearpolitics.com/video/2019/09/15/joe_biden_recalls_terrifying_1960s_public_pool_confrontation_with_razor-weilding_gangster_named_corn_pop.html

  10. I$’nt It $till February? … Oop$, maybee pre.mature $peculation$!

    … while pe$$imism among U.S. consumers fell to an almost 18-year low.

    Busine$$
    U.$. Con$umer Confidence Ri$es to Six-Month High on Outlook

    Bloomberg |By Max Reyes |February 25, 2020

    U.S. consumer confidence edged up in February to the best level in six months on an improvement in expectations, signaling that solid employment and cheap fuel are helping Americans look pa$t concern$ about the spread of the coronaviru$.

    The Conference Board’s reading increased to 130.7 from a downwardly revised 130.4 in January, according to data from the New York-based group Tuesday that fell short of estimates in Bloomberg’s survey of economists. The economic expectations measure climbed to a seven-month high that barely offset the weakest reading for the present situation in eight months.

    Key Insight$:

    The fourth straight gain indicates that consumers are still upbeat as the labor market remains robust. The composition of the report showed that buying plan$ for auto$, home$ and appliance$ all po$ted increa$e$.

    The report showed 6.3% of respondents indicated they planned to buy a new vehicle in the next six months, while 2.4% said they aim to purchase a new home, both multi-year highs.

    The reading is in step with other confidence measures, which remained elevated in February. The University of Michigan’s survey rose to the highest level in almost two years, while pessimism among U.S. consumers fell to an almost 18-year low, according to Bloomberg’s Consumer Confidence Index.

  12. Change$ are.a.foot for Thee Wanker.Banker$! … $ad, $o very $ad. … Go, Robot$!

    Ouch. Investment banking revenue hasn’t been this weak since 2008

    By Matt Egan, CNN Business | Tue February 25, 2020

    Revenue at the top 12 global inve$tment bank$ fell 3% in 2019 to the weake$t level since the chao$ of the 2008 financial cri$is, according to Coalition, a business intelligence provider.

    Revenue is down for the fourth year out of the past five.

    New York (CNN Business)
    Pink slips are flying on Wall Street and at leading investment banks around the world as the industry grapples with shrinking revenue and profound change to their business models.

    HSBC announced plans last week to slash about 35,000 jobs to combat crumbling profits. Deutsche Bank (DB) cut 18,000 jobs last summer as Germany’s biggest bank tries to rebuild itself. And Morgan Stanley (MS) trimmed its workforce by 1,500 late last year.

    Even big bank bosses are on the chopping block. The CEOs of Credit Suisse, UBS (UBS) and HSBC (HBCYF) have all stepped down for various reasons within the past six months. And Barclays CEO Jes Staley is being investigated by regulators over his ties to disgraced financier Jeffrey Epstein.

    Meanwhile, Morgan Stanley is spending $13 billion to acquire online broker E-Trade (ETFC) in a bid to make its business model less volatile.

    “Investment banks are being forced to rethink their entire business,” said Ian Winer, a Wall Street veteran who currently serves as an advisory board member at hedge fund Bellator Asset Management. “There just aren’t many ways for them to make money in the traditional way.”

    IPO dud$:The

    That’s why they are doing some serious belt-tightening. Headcount at leading investment banks dropped by 6% last year, the fifth-straight year of declines, according to Coalition.

    “The quickest way to cut costs are personnel. It’s like shoot first and ask questions later,” said Winer.

    “The IPO market collapsed after WeWork,” said Gerard Cassidy, a banking analyst at RBC Capital.
    Some companies like Slack (WORK), Spotify (SPOT) and iHeartMedia (IHRT) have decided to go public through direct listings, bypassing the expensive fees they would owe investment banks altogether. Others like Richard Branson’s Virgin Galactic (SPCE) went public through a merger with a special purpose acquisition corporation.

    Muted volatility — until now at least
    Another problem for investment banks is that up until very recently, financial markets have behaved very calmly. Extremely low interest rates from central banks around the world has suppressed market volatility. That, in turn, limits the fees that big banks haul in when large hedge fund clients trade with a frenzy. And it lowers demand for the complex equity-trading instruments that sophisticated clients buy from investment banks during times of market turmoil.

    Even Monday’s 1,000-point plunge on the Dow only lifted the VIX (VIX) volatility index to 24. That’s still relatively calm by market freakout standards.

    “People just aren’t trading as much. It’s harder for banks to make money,” said Winer.

    The rise of the robot$:

    RBC’s Cassidy partially blames the “electronification” of the business. As robots replace humans in trading, large institutional investors are demanding lower fees for executing trades.

    “The days of thousands of traders on the New York Stock Exchange are gone. It’s all been replaced by robots,” said Cassidy.

    Robots are also replacing stock pickers. Investors have ditched expensive active managers in favor of dirt-cheap ETFs and other passive investment vehicles. That long-running trend is forcing active investment firms to find ways to cut costs, including by demanding cheaper transaction costs from the major investment banks executing their trades.

    The ETF boom is also spurring consolidation. Last week, Franklin Templeton parent Franklin Resources reached a $4.5 billion deal to acquire rival Legg

    At the same time, the online brokerage industry has been turned on its head by the rise of Robinhood and free trading. Discount brokers slashed their trading fees to zero and Charles Schwab (SCHW) and TD Ameritrade (AMTD) are joining forces. This free trading phenomenon is putting additional pressure on investment banks to cut their transaction costs.
    “I don’t know how you compete against that,” said Winer.

    All of these headaches help explain Goldman Sachs’s decision to build a consumer banking giant called Marcus and Morgan Stanley’s takeover of E-Trade. After the E-Trade deal is finalized, Morgan Stanley will generate 57% of its pre-tax profits from wealth and investment management. That’s up from just 26% a decade ago.

    Wall Street firms are diversifying away from the volatile markets business in favor of more stable Main Street ones.

    “The whole game has changed,” said Winer.

  13. The Dow is cratering, but gold and silver are also down substantially? I don’t get it.

    And meanwhile, the Palladium bubble continues to inflate. I sold mine it about 1,600, cuz I couldn’t imagine it going higher. I have no idea why it was 1600 then, and even less idea why it’s 2600 now.

        1. Perhaps one might like to compare that 20 year chart to the M2 money supply found here:

          https://fred.stlouisfed.org/series/M2

          Also the all in sustaining cost of production per ounce which is somewhere north of 1000$/oz.

          For comparison, oil is about 50$/barrel and the lowest cost producer is Aramco at about 3$/barrel. I believe the global average production cost per barrel is between 30-40$/barrel.

          1. Money is borrowed into existence. And, the money supply really increases as mortgage borrowing increases especially when the homes are over-priced. The increased taxes, fees, etc., are helping to pay for the baby boomer entitlement tsunami as Wall street failed to provide stable retirements.

        1. Silver is down because all the margin call losers are liquidating assets. I’m happy to buy as much as I can at these prices.

  14. South Korea Coronavirus infections are now roughly 1,000, and surging. That’s the same number China was reporting one month ago today. However, South Korea has less than 4% of the population that China has.

  15. Click on my name for full link.

    Housing Market Is Strong But Home Prices Are In A Bubble: Book Profits On These 5 Stocks
    Intelligent Investing
    Richard Henry Suttmeier Contributor

    Homebuilder sentiment is strong. Single-family housing starts are rising. Home prices are in a reinflated bubble.

    Recent housing data has been positive.

    The National Association of Home Builders Housing Market Index slipped by one point in February to a still extremely elevated reading of 74, well above the neutral reading is 50. The last three monthly readings are the highest levels since December 2017.

    Single-family housing starts decreased by 5.9% in January to a seasonally adjusted annual rate of 1.01 million units. Despite this slip single-family starts have been above one million for the second month in a row.

    Despite these positives, homebuilders are concerned about excessive regulations, labor shortages and rising materials costs.

    The latest reading is for November 2019. The 20-City Composite is up 2.6% year-over-year from 2.2% in October as the home-price bubble continues to reinflate. The three leading cities are Phoenix, up 5.9%; Charlotte, up 5.9%; and Tampa, up 5%.

    The chart shows that home prices peaked in July 2006 and declined by 35.1% to a cycle low in March 2012. Since then the home-price bubble reinflated by 63.1%. This reading is 5.9% above the July 2006 high. This questions home affordability. Household incomes did not match this rise since March 2012 and household debt rose to record levels of 14.15% at the end of 2019.

  16. Based on us trying to purchase in San Diego, its full steam ahead. We offered cash for a home in Vista that has falled out of escrow 4 times. Of course our offer was low so the seller took the conventional financing, their realtor told us sorry they went with the higher offer, and 5 hours later said the buyer had an illness and withdrew would we come up. Nope, final offer. Home continues to sit.

    The neighborhood we really like in Oceanside comps were falling to 699-710k then last month shot up with 2 closes in mid 750’s and now in less than a week their neighbor sold for 800k. So 100k increases ever since the last interest rate cut.

    1. Why would you be paying cash for an outrageously overpriced shack when you know we’re in the biggest bubble in history?

    2. You read this blog and are still trying to buy in the midst of a bubble? Some DebtDonkeys never learn. Even dumber to buy a house that fell out of escrow 4 times and likely has something uncovered during inspection. It’s unlikely the sellers picked four offers that were so poorly qualified. And you are supposedly seeing a near 100k (12%) gain in a few months, and you don’t see any problem with buying?

      Rent for less and buy after prices correct.

      1. and likely has something uncovered during inspection ??

        In California, that information found “must” be disclosed to any future buyer…Big trouble if you don’t…Both criminal & financial…

    3. “We offered ca$h …” = de$peration … (It has a peculiar $ort of $mell, attract$ buzzard$, they might be circling around you now as move full.$team ahead!)

      1. Dear Jim, what income$ i$ required to $upport a $650,000 plea$ant mortgage$ payment$ for those $helter.$hacks in wonderous$ Ocean$ide$? … (Excluding any “normal.co$t.of.living$” (- minu$ + babie$) for a young couple in their 20’$?)

        Go Robot$ & “other$!”

  17. Again, not sure how this realwhore b*t*h got my contact but Linda from LV just sent me this email. At least they are admitting now prices are dropping. This is the new selling points and of course, for all you broke losers with no money, here are some loan assistance programs!!!

    —-

    Hello!

    Spring is almost here and that means the Busy Home Shopping Period is about to Begin! With a High Inventory of Homes and Prices are Dropping, there are Great Loan Incentive Programs too.
    There are 3 Down Payment Assistance Loan Programs Available now- up to $24k!

    lindas saving money home pic.jpg

    They are:

    The Home is Possible Program, gives you up to 5% down payment assistance, all areas of Las Vegas & Henderson included!

    Home at Last Program, gives you up to $24,000- down payment assistance, restricted parts of Las Vegas Qualify for it- the Northwest, the North, part of Southern Summerlin & Southern Highlands, Enterprise area and the Wetlands Area on the South East side.

    The HOPE Program, gives you up to $20,000- down payment assistance, restrict areas of Las Vegas in these zip codes- 89030, 89101,89102, 89103, 89104, 89106, 89107,89108,89109,89110, 89115, 89119, 89120, 89121, 89122, 89146, 89156 & 89169

    Contact me for the Details and let’s go House Shopping!

    2. “Down Payment Assistance Loan Programs”

      I don’t need this. I could qualify for a 15 year mortgage with 20+ percent down on used house in Denver, but I won’t buy at today’s asking prices.

      Turning the heat up tonight (on the landlord’s dime) because it’s going down to 8F degrees, haven’t directly paid a heat bill to a utility company in a decade LOLZ.

      1. “…down to 8F degrees…”

        I imagine that apartment walls perform poorly at those temperatures. Do you have a unit below yours?

    3. Where exactly is South Summerlin? I wonder if my old neighborhood, in the 7400 block of West Charleston, as part of that

      1. There’s a whole bunch of liars out there saying “house across the street just sold 5 minutes after it was listed.”

        Never any proof. No data. Nothing but lies.

        1. Think about the implications. If they could sell they would and they can’t. Yet every single RE outfit in the US has been crowing about how red-hot! Boise is for a long time. Somebody is a lion. And they have been for at least a year.

          Sometimes reports are accurate. But when it comes to the REIC you just can’t trust anything they say.

          1. Maybe you should start your own blog where you can post your inane babblings courtesy of Orange Man Bad syndrome. Your nonsense is ~ 20% of the text on this comment board? Time to go and take your dumb azz dollar signs with you!

          2. As a former liberal, I can deal with the content of the posts, but the extraneous emojis and $$ are a toughie for me.

          3. Your non$en$e is ~ 20% of the text on this comment board?

            Hwy comments x9 … Total comment$ @ this juncture: 72

            72/9 = 8% … knot$ yer … 20%

            ($o much Wall.$treet craterin’ & $helter.$hack.$uffering$, eye can’t keep up!)

            Iffin’ yer $tock.pickin’.abilitie$ are @ $kill level$ with yer math, you mu$t be $uffering incon$olably.I

            Yoda: “yer.nerve$, … $ensitive they mu$t bee. $tay with the kind force$!” & live.long & pro$per! 🙅✌

          4. Time to go and take your

            He’s an old friend here Newbie.

            Get the Joshua Tree Extension if the $$$ sets your hair on fire.

          7. $orry, eye cannot find a emoji for “humility” …
            May bee 🐜 … 💞 … ( what does that $uggest for what’$ creatively available from the creator$ of such digital.device$? )

            ” … i think its a radical way of posting. ”

            “Evolution of language is the gradual change in human language over time. It involves the origin and divergence of language$ and language familie$, and can be considered analogous to biological evolution, although it does not nece$$arily occur through the same mechanisms.

            Evolution of language – Late$t re$earch and news | Nature

  19. ‘While home prices have reached the peak levels seen during the height of the housing boom, there is no evidence of a bubble because price appreciation now is much more modest,’ says Virginia REALTORS Chief Economist Lisa Sturtevant, PhD.

    It wasn’t a housing “boom,” Lisa. It was a classic bubble. Now the Keynesian fraudsters at the Fed have blown another bubble. And it’s going to end in tears just like the first one.

  20. “Good news: 2020 is looking like another fabulous year for both commercial and residential real estate purchases.

    Once the Everything Bubble implodes, it will indeed be a fabulous year for real estate purchases.

  21. San Diego, CA Housing Prices Crater 17% YOY As One Broker Shared, “Rent A House For Half The Monthly Cost. Buy It Later Because Prices Are Plunging.”

    https://www.zillow.com/san-diego-ca-92109/home-values/

    *Select price from dropdown menu on first chart

    A noted economist stated, “If you have to borrow for 15 or 30 years, you can’t afford it nor is it affordable.”

  22. $ad, … $o $ad. … 1$t Wanker.Banker$, now $helter.$hack.builder$. T$k, T$k

    $hares of Toll Brother$ $lumped 8.6% to $40.50 a share in after-hours trading.

    Toll Brothers stock down 7%+ after lower Q1 profit

    MarketWatch |Published: Feb 25, 2020 | By Kimberly Chin

    Toll Brother$ Inc. posted lower first-quarter profit as $ales $lipped.

    The home-construction company reported $56.9 million, or 41 cents a share, in earnings in the quarter ended Jan. 31, down from $112.1 million, or 76 cents a share, in the same quarter last year.

    $elling, general and admini$trative expense$ notched up 18% from a year earlier.

    Toll Brothers reported $1.33 billion in sales, down from $1.36 billion in the prior year. Analysts expected $1.44 billion.

  23. Luxury stores, like Hermes — coming to Somerset Collection this year

    Somerset Collection is near and dear to us. Having said that — you ought to have a look at this particular store’s web site:

    https://www.hermes.com/us/en/product/summer-sandal-H182372ZH03430/

    Yes, that’s a $445 pair of flip flops.

    Should note that Hermes has displaced the Crate & Barrel that formerly occupied this location, the latter now having relocated to another metro area mall somewhat less frequented by folks who light their cigars with Benjamins.

    Lee said the experience of an [Restoration Hardware] Gallery is a trend keeping malls relevant, like the one that was pitched for downtown Birmingham but was scrapped after the development around the North Old Woodward bond proposal failed last fall.

    RH is another Somerset Collection store. I posted here about the failed ballot measure to replace the old parking structure (which is apparently now dropped a chunk of concrete on an unfortunate person’s car) last fall. Voters rejected the proposal mainly due to what they felt what dishonesty about how much parking would have actually gone to city residents versus the businesses that were included in the project:

    https://www.hometownlife.com/story/news/local/birmingham/2019/08/06/birmingham-election-2019-parking-proposal-fails/1934863001/

    “We’re here in beautiful downtown Birmingham, and you’ll see the overall sales went down 8.6%,” North said. “That seems really concerning, but I would be careful when we’re looking at numbers like this. That represents a much larger amount of sales in comparison to Bloomfield Township — well, certainly Bloomfield Hills.”

    Nice spin there, John. Birmingham is flush (and getting flusher) with seven figure luxury properties that are unoccupied and growing moldy, with no prospective buyers in sight.

    “I do think there are things that Birmingham or Bloomfield Hills could do to increase affordable housing if they chose to make that something they felt was needed in the community, whether it’s through maybe creating some tax breaks and incentives for developers to work that land that is perhaps a little more expensive than other places,” North said, explaining that developers need to offset the high costs incurred between the time they purchase the land and put a shovel into the ground.

    Nope — couldn’t keep a straight face…

    Looking for an “affordable” home in the city? Here you go:

    https://www.zillow.com/homedetails/1744-Maryland-Blvd-Birmingham-MI-48009/24506933_zpid/

    Anything in this city cheaper than $300K is either a poorly maintained rental or has a date with the wrecking ball.

    “I’m not a big believer that we’re in a bubble of any sort as it relates to real estate, residential or commercial. I believe due to a lot of the changes that were made during the last downturn, and I think most experts believe, that if we have a recession, it would probably be short lived, and certainly there’s no indication that housing will play any role in leading us into it like it did in the past one,” he said.

    Saving this.

    2. “Ye$, that’s a $445 pair of flip flop$.” 👣

      I$n’t it a wonderou$ thing to utilize credit$ & the endle$$ ability to ama$$ debt$ to $uperlative level$? 💳🏧😍👏

    3. I grew up in Beverly Hills, been gone for 30yrs, still have family there. ABSOLUTELY STUPID HOUSING PRICES, fun town if you are single, have money, and a place in Harbor Springs to spend the holidays. Other then that, it’s cold and grey 7 months outta the year, taxes are way way way to high, the roads suck, Detroit is coming back, and cool if oyu are young. Grand Rapid, thats a cool town, S.E. capital. Again, housing is way over priced, and ripe for a 20-30% drop over the next 2yrs.

      1. “Again, housing is way over priced, and ripe for a 20-30% drop over the next 2yrs.”

        $o for some folks:
        $600,00 – 30% = (-180,00) = $420,00)

        $400,00 – 30% = (-120,00) = $280,00)

        Bugs: ” eh, eye think yer on to $omething Doc! ”

        Dear Professor, could you plea$e check my math … It’$ almost a 4th knight!

        Go james jim!

  24. Dai$y petal$ falling DOWn: “We don’t need China!” … “We need China!”

    $uch indeci$ion is $o $ad. … (Confucius fortune.cookie$ says: “He WHO cannot decide, is lo$t.)

    OUT$IDE THE BOX:

    Opinion: China faces the po$$ibility of a financial cri$i$, which would $end a $hockwave through the world!

    MarketWatch | By Brian Frank | Published: Feb 25, 2020

    Chine$e bank failure$, loan default$ and $upply-chain di$ruption$ would put dent$ in global GDP

    We may not know for months, or even years, the global health implications of COVID-19. What we do know is China is effectively locked down with minimal return to work, neighboring countries including Japan and South Korea are already canceling major events like the Tokyo Marathon, and consumers worldwide are rapidly altering their spending patterns. Those changes affect global company earnings and markets regardless of the ultimate spread of COVID-19. How large of an effect is difficult to determine.

    Why? China has been in a construction-spending spree since the global financial crisis, fueled by its central bank, the People’s Bank of China (PBoC), creating gobs of money and lowering lending standards. As a result, the country is the largest buyer of most commodities and construction materials, and companies worldwide have reaped the benefit of this frenzy.

    Like all economic booms, excess and mal-investment are present, with vacant real-estate properties and low or no return-on-investment projects. The sheer amount of loans outstanding require perfect economic conditions with no exogenous shocks. Currently, with mass quarantines and fear, it should be expected that a large percentage of these loans enter default. Given the extreme level of banking assets relative to Chinese GDP, this is a recipe for a financial crisis.

    Should China enter financial crisis, the world would be severely impacted. Bank failures and loan defaults would spike, sending ripples around the global banking system. Given the record amounts of corporate debt at U.S. corporations, any increase in global lenders’ fear levels would impact borrowers. As China is a main supplier of numerous Western companies, the ensuing disruptions and restructuring would add to the supply-chain shocks already present with COVID-19.

    Looking at companies’ supply chain and overall sales exposure to China, the impacts of COVID-19 fear are clear. On Feb. 17, Apple AAPL-3.39% released an update on its quarterly guidance. The company said it did not “expect to meet the revenue guidance we proved for the March quarter due to two main factors.” First, Apple is unable to source adequate supply of iPhones. Second, demand for Apple products in China has been affected due to partner store closures.

    According to Apple’s latest 10-K report, sales to Greater China were $43 billion in fiscal 2019, which is about 16.5% of total sales. Sales to Japan and “rest of Asia Pacific” are an additional $39.3 billion, bringing total sales to COVID-19-affected regions to 31.8% of Apple’s sales. Apple did not provide an estimate for March 2020 quarterly sales

    Tourism has already been impacted in China and other countries as well. Cruise-ship operators Royal Caribbean RCL-7.31% and Carnival CCL-5.08% have already issued earnings warnings. As the world watches a quarantined ship in Japan fail to prevent COVID-19 infection among most of the passengers, it is likely vacation-goers may think twice before booking a cruise this year or next. Events like the Tokyo Marathon have already been canceled, and investors may already be looking ahead to the potential cancelation of the Tokyo Summer Olympics as another hit to GDP. Now that COVID-19 has materialized in northern Italy, additional types of vacations may be canceled, and revenue lost.

    Countless companies, banks, borrowers and consumers rely on complex supply chains for their incomes. As China is a much larger percentage of global GDP and bank assets than ever before, the country’s strong, mandatory quarantine approach will affect the world even if infections abate.

    Instead, with the recent spread to Japan, South Korea and Italy, it looks like total infections will continue to grow. With elevated valuations on U.S. stocks, it is unlikely that investors have discounted recessions, loan defaults or decreases in spending.

  25. Technology
    How the Coronavirus Revealed Authoritarianism’s Fatal Flaw
    China’s use of surveillance and censorship makes it harder for Xi Jinping to know what’s going on in his own country.
    Zeynep Tufekci
    February 22, 2020
    People wearing masks walk past a portrait of Chinese President Xi Jinping.
    Aly Song / Reuters

    China is in the grip of a momentous crisis. The novel coronavirus that emerged late last year has already claimed three times more lives than the SARS outbreak in 2003, and it is still spreading. More than 50 million people (more than the combined metro populations of New York, Los Angeles, Chicago, and San Francisco) remain under historically unprecedented lockdown, unable to leave their city—and in many cases, even their apartment. Many countries no longer accept visiting Chinese nationals, or if they do, quarantine them for weeks. Big companies are pulling out of trade shows. Production is suffering. Profound economic consequences are bound to ensue, not just in China but around the world.

    How did Xi Jinping—the general secretary of the Communist Party of China, who has been consolidating his power since taking over the post in 2012—let things get to this point?

    It might be that he didn’t fully know what was happening in his own country until it was too late.

    Xi would be far from the first authoritarian to have been blindsided. Ironically, for all the talk of the technological side of Chinese authoritarianism, China’s use of technology to ratchet up surveillance and censorship may have made things worse, by making it less likely that Xi would even know what was going on in his own country.
    …

  26. The coronavirus news keeps getting worser and worser.

    The Financial Times
    Coronavirus
    Wall Street falls sharply for second day on virus fears
    S&P 500 dips 3% and Treasury yields touch record low after US, Japan, Italy warnings
    3 hours ago

    More on this topic
    Coronavirus latest: Asia stocks fall after new Wall Street sell-off

    US official warns public to prepare for coronavirus outbreak

    1. The coronavirus news keeps getting worser and worser.

      To me it seemed like the bad news was there almost from the beginning. Some people are just now waking up and doing the math.

      I was surprised to get retweeted by Mish Shedlock earlier today on this topic.

    2. “The coronavirus news keeps getting wor$er and wor$er. ”

      aqdanny.boy = MIA

      Oil$ = glut
      Natural ga$ = glut
      Coal.in.hole$ = glut

      $hall eye goe$ on? …

      T$k, T$k …

        1. aqdanny.boy is $ailing on those “Boeing Dec 2019 tailwind$” May bee to the U$ Virgin I$lands? … Non.Hurricane.$eason! $tirring hi$ drink$, Go.Coal!

    3. It’s like coronavirus denial has given way to fear.

      The Financial Times
      Coronavirus Outbreak
      Analysis
      Coronavirus
      China fall in virus cases undermined by questionable data
      Experts say decline in new infections is likely but official count also mired in politics

      Coronavirus
      Italy warns EU on budget targets as coronavirus cases rise
      Rome says Brussels may need to offer flexibility as outbreak extends to other EU countries

      Coronavirus
      Chevron sends 300 UK workers home on coronavirus scare
      Oil company tells staff in London to work remotely after employee reports symptoms

      1. Read somewhere that they’re closing schools in the UK as a precaution since many students are returning from ski trips in northern Italy and may have been exposed.

      2. The Financial Times
        Markets Briefing
        European stock sell-off deepens as coronavirus concerns rise
        Stoxx 600 index falls for a third day as outbreak spreads and companies warn on impact
        an hour ago

        More on this topic
        Coronavirus latest: WHO says outbreak not ‘pandemic’ even as Covid-19 spreads

        Wall Street banks plan to separate Tokyo teams on virus fears

        Nouriel Roubini: Markets are too complacent about virus

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